In Markets

5 tips on surviving Hong Kong’s luxury retail market crisis

No stranger to the luxury industry, Francis Gouten boasts over 35 years of experience in luxury goods at companies including Cartier, Piaget and Richemont Asia Pacific Ltd, where he was formerly chief executive.

Now director of Gouten Consulting, a company that helps luxury brands with their marketing and strategic development in Asia Pacific, he shares five tips on surviving Hong Kong’s current retail market crisis with EJInsight.

1. Reduce store sizes and bring more diversity to malls.

Before, many big brands set out to impress the mainland Chinese [with bigger stores]. But this killed the malls and the interest in those places, because when you have a brand on three floors, what else is there?

2. Go back to the heritage of brand and target the core customer.

Top brands need to go back to their original positioning of a premium experience by welcoming the clients, providing a high-quality service and exclusive offerings.

3. Upgrade the quality of service.

You need to protect your DNA, origin, and essence of the brand. How can brands understand their clients? How can they serve them better?

[Improve customer service] through detailed training programs for all in-store staff.

4. Be careful with e-commerce.

[In China,] you have many fake products, and e-commerce is also a discount business. I do not recommend luxury brands go there. If I can buy your products in mass on the internet, what does that do to your image?

But e-commerce cannot be stopped – it needs regulation. The majority of brands do not understand it. But it is important for brands to have people who understand the digital environment.

5. Reinvigorate the luxury experience and focus on attention to detail.

The experience of luxury should be intimate, bespoke and, above all, exclusive. Going back to the roots of luxury and targeting the core customer will ensure a bright future for luxury.

(Image credit: Savills)

(Source: EJInsight)

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